IRVING, Texas, Dec. 7, 2021 /PRNewswire/ -- Vistra Corp.
(NYSE: VST) today announced the pricing of an upsized private
offering of 1,000,000 shares of its 7.0% Series B
Fixed-Rate Reset Cumulative Redeemable Green Perpetual Preferred
Stock to qualified institutional buyers pursuant to Rule 144A under
the Securities Act of 1933, as amended, and to certain non-U.S.
persons in accordance with Regulation S under the Securities Act,
at an offering price of $1,000 per
share. The company will receive gross proceeds of $1 billion from the sale of the Preferred
Stock before deducting the initial purchaser discount and other
estimated offering expenses. The offering is expected to close on
Dec. 10, 2021, subject to customary
closing conditions.
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"This milestone is the latest proof point in the strength of
Vistra's strategic plan, Vistra Zero growth pipeline and future
earnings potential," said CEO Curt
Morgan. "The upsized green offering will provide Vistra with
cost-efficient capital to deliver on our disciplined capital
allocation plan, including funding the development of Vistra Zero
and other growth opportunities, returning capital to shareholders
and paying down debt."
Vistra's Capital Allocation Plan
The offering represents another step in Vistra's broader capital
allocation plan, which was announced in October and November 2021. In addition to the $7.5 billion return of capital and the reduction
of up to $3 billion of debt
(exclusive of project financing) planned between now and year-end
2026, Vistra also set forth its intent to accelerate the
development of its zero-carbon growth pipeline with cost-efficient
capital.
Vistra expects its zero-carbon generation portfolio, Vistra
Zero, to have 7,300 megawatts of solar and energy storage
facilities online by year-end 2026, including approximately 2,900
MW of such generation currently online.1
Expected investment from 2022 to 2026 is approximately $5 billion. Vistra intends to fund this
development primarily via project financing, supplemented by Vistra
Zero project cash flows,2 and a portion of
the net proceeds of the offering. Importantly, with the successful
upsizing of the offering, Vistra expects the offering proceeds will
satisfy not only the third-party equity financing Vistra had
contemplated, but also the cumulative capital contributions Vistra
expected to make over the five-year period. Accordingly, Vistra
expects to have additional cash available to allocate to share
repurchases, growth opportunities and/or debt repayments over the
next five years, as compared to its previous estimates.
Vistra expects its Vistra Zero portfolio will grow to at least a
projected $450-500 million adjusted
EBITDA,2 highly contracted business by the
end of 2026.
(1) Includes Comanche Peak Nuclear Power
Plant
(2) Excludes Comanche Peak Nuclear Power
Plant
Green Finance Framework and Use of Proceeds
The company intends to use an amount equal to the net proceeds
from the offering to pay or reimburse the payment, in whole or in
part, of existing and new Eligible Green Projects within the U.S.
in accordance with the criteria set forth in the Vistra Green
Finance Framework, which is available on the company's website.
Details on the Preferred Stock
The annual dividend rate on each share of Preferred Stock is
7.0% from the original issuance date to, but excluding,
December 15, 2026 (First Reset Date).
On and after the First Reset Date, the dividend rate on each share
of Preferred Stock shall equal the five-year U.S. Treasury rate as
of the most recent reset dividend determination date (subject to a
floor of 1.26%), plus a spread of 5.74% per annum. The Preferred
Stock has a liquidation preference of $1,000 per share, plus accumulated but unpaid
dividends. Cumulative cash dividends on the Preferred Stock are
payable semiannually, in arrears, on each June 15 and December
15, commencing on June 15,
2022, when, as and if declared by the company's Board.
The Preferred Stock is not convertible into or exchangeable for
any other securities of the company and will have limited voting
rights. The Preferred Stock may be redeemed at the option of the
company in certain circumstances.
The Preferred Stock will not be registered under the Securities
Act or any state securities laws and may not be offered or sold in
the U.S. absent registration or an applicable exemption from such
registration requirements.
This press release shall not constitute an offer to sell or a
solicitation of an offer to buy the Preferred Stock, nor shall
there be any sale of the Preferred Stock in any state or
jurisdiction in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of such state or jurisdiction.
About Vistra
Vistra (NYSE: VST) is a leading, Fortune 275 integrated retail
electricity and power generation company based in Irving, Texas, providing essential resources
for customers, commerce, and communities. Vistra combines an
innovative, customer-centric approach to retail with safe,
reliable, diverse, and efficient power generation. The company
brings its products and services to market in 20 states and the
District of Columbia, including
six of the seven competitive wholesale markets in the U.S. and
markets in Canada and Japan, as well. Serving nearly 4.3 million
residential, commercial, and industrial retail customers with
electricity and natural gas, Vistra is one of the largest
competitive residential electricity providers in the country and
offers over 50 renewable energy plans. The company is also the
largest competitive power generator in the U.S., with a capacity of
approximately 39,000 megawatts powered by a diverse portfolio,
including natural gas, nuclear, solar, and battery energy storage
facilities. In addition, Vistra is a large purchaser of wind power.
The company owns and operates a 400-MW/1,600-MWh battery energy
storage system in Moss Landing,
California, the largest of its kind in the world. Vistra is
guided by four core principles: we do business the right way, we
work as a team, we compete to win, and we care about our
stakeholders, including our customers, our communities where we
work and live, our employees, and our investors.
Cautionary Note Regarding Forward-Looking
Statements
The information presented herein includes
forward-looking statements within the meaning of the Private
Securities Litigation Reform Act of 1995. These forward-looking
statements, which are based on current expectations, estimates and
projections about the industry and markets in which Vistra Corp.
("Vistra") operates and beliefs of and assumptions made by Vistra's
management, involve risks and uncertainties, which are difficult to
predict and are not guarantees of future performance, that could
significantly affect the financial results of Vistra. All
statements, other than statements of historical facts, that are
presented herein, or in response to questions or otherwise, that
address activities, events or developments that may occur in the
future, including such matters as activities related to our
financial or operational projections, the potential impacts of the
COVID-19 pandemic on our results of operations, financial condition
and cash flows, projected synergy, value lever and net debt
targets, capital allocation, capital expenditures, liquidity,
projected Adjusted EBITDA to free cash flow conversion rate,
dividend policy, business strategy, competitive strengths, goals,
future acquisitions or dispositions, development or operation of
power generation assets, market and industry developments and the
growth of our businesses and operations (often, but not always,
through the use of words or phrases, or the negative variations of
those words or other comparable words of a future or
forward-looking nature, including, but not limited to: "intends,"
"plans," "will likely," "unlikely," "believe," "confident",
"expect," "seek," "anticipate," "estimate," "continue," "will,"
"shall," "should," "could," "may," "might," "predict," "project,"
"forecast," "target," "potential," "goal," "objective," "guidance"
and "outlook"),are forward-looking statements. Readers are
cautioned not to place undue reliance on forward-looking
statements. Although Vistra believes that in making any such
forward-looking statement, Vistra's expectations are based on
reasonable assumptions, any such forward-looking statement involves
uncertainties and risks that could cause results to differ
materially from those projected in or implied by any such
forward-looking statement, including, but not limited to: (i)
adverse changes in general economic or market conditions (including
changes in interest rates) or changes in political conditions or
federal or state laws and regulations; (ii) the ability of Vistra
to execute upon its contemplated strategic, capital allocation,
performance, and cost-saving initiatives and to successfully
integrate acquired businesses; (iii) actions by credit ratings
agencies; (iv) the severity, magnitude and duration of pandemics,
including the COVID-19 pandemic, and the resulting effects on our
results of operations, financial condition and cash flows; (v) the
severity, magnitude and duration of extreme weather events
(including winter storm Uri), contingencies and uncertainties
relating thereto, most of which are difficult to predict and many
of which are beyond our control, and the resulting effects on our
results of operations, financial condition and cash flows; and (vi)
those additional risks and factors discussed in reports filed with
the Securities and Exchange Commission by Vistra from time to time,
including the uncertainties and risks discussed in the sections
entitled "Risk Factors" and "Forward-Looking Statements" in
Vistra's annual report on Form 10-K for the year ended December 31, 2020 and any subsequently filed
quarterly reports on Form 10-Q.
Any forward-looking statement speaks only at the date on which
it is made, and except as may be required by law, Vistra will not
undertake any obligation to update any forward-looking statement to
reflect events or circumstances after the date on which it is made
or to reflect the occurrence of unanticipated events. New factors
emerge from time to time, and it is not possible to predict all of
them; nor can Vistra assess the impact of each such factor or the
extent to which any factor, or combination of factors, may cause
results to differ materially from those contained in any
forward-looking statement.
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SOURCE Vistra Corp.